New York, NY: Indian American former Goldman Sachs director Rajat Gupta has been released after completing his two-year prison term, weeks after a U.S. court agreed to rehear his appeal to throw out his 2012 insider-trading conviction. Gupta, 67, was “released” on March 11, according to his record at the Federal Bureau of Prisons.
While Gupta’s prison term was to end on March 13, since the date fell on a Sunday, he was released on Mar. 11, four years after he lost his insider trading trial and suffered multiple legal setbacks to overturn his conviction. The Harvard-educated executive was convicted in his 2012 trial of passing confidential boardroom information to his one-time friend and business associate Raj Rajaratnam.
Apart from the two-year prison term, he was fined $5 million, and the Securities and Exchange Commission also slapped a $13.9 million penalty against him. Gupta started out his prison term in 2014 at FMC DEVENS, an administrative security federal medical center with an adjacent minimum security satellite camp in Ayer, Mass.
Ever since his conviction in June 2012, Gupta filed several appeals, including to the U.S. Supreme Court, to overturn his conviction and prison term, but the courts rejected his arguments and affirmed his sentence.
However, it was only early last month, just weeks before his prison term was to end, that he had some legal respite when the U.S. Second Circuit Court of Appeals agreed to rehear an appeal to throw out his insider-trading conviction.
The minimum-security prison camp where Gupta did his time is about 40 miles (60 kilometers) west of Boston and formerly the site of a military base. Rajaratnam, who is serving 11 years for trading on inside tips, is at an adjacent medical center because he has diabetes and kidney disease. Gupta completed the last two months of his prison term at his home in Manhattan, after being released on Jan. 5 from the Devens correctional facility.
Even though he was not in the prison center, he remained a federal inmate until his release on March 11. He was confined to his Westport, Conn., home and was required to wear an ankle bracelet that monitored his movements.
According to AP, Gupta’s lawyers said in their latest appeal that his 2012 conviction on conspiracy and securities fraud charges should be tossed because he was innocent and the jury was improperly instructed.nHis attorney Gary Naftalis says he is pleased with the court’s ruling and believes there are meritorious issues to present on appeal.
A former McKinsey & Co. managing partner, Gupta is the highest-profile executive convicted in a U.S. crackdown on insider trading at hedge funds. Gupta was found guilty in 2012 of passing illegal tips to Rajaratnam, a co-founder of the Galleon Group LLC hedge fund. He told Rajaratnam about Berkshire Hathaway Inc.’s $5 billion investment in Goldman Sachs and the bank’s financial results for two quarters in 2008. Since August 2009, federal prosecutors in New York won 80 convictions.